Senators Move To Reverse Trump's Deal Lifting Sanctions On China's ZTE

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In early June, the White House announced ZTE would be able to resume buying US parts after it agreed to pay a $1 billion fine and submit to USA oversight.

China's No. 2 telecommunications equipment maker was crippled when the United States imposed a seven-year supplier ban on the company in April after it broke an agreement to discipline executives who conspired to evade US sanctions on Iran and North Korea.

Trump has come under scathing criticism from members of his own party, who viewed the president's efforts to help ZTE as anathema, both economically and in terms of national security.

The move enraged Republicans and Democrats who said ZTE not only worked with Iran and North Korea in violation of US sanctions, but is a threat to national security, offering Chinese intelligence operatives a way to spy on the USA through ZTE products. The order forced ZTE to effectively.

The U.S. commerce department can exercise discretion in granting exceptions.

Experts say the company faces challenges in getting its factories up and running again while also overhauling its management to meet the terms of the USA deal. "Therefore, ZTE will most likely be able to resume operations in middle of next week".

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The US government said it imposed the ban in April because ZTE violated a 2017 agreement in which the Chinese company admitted to evading sanctions on Iran and North Korea.

Under orders from Mr. Trump, the Commerce Department last week weakened penalties on ZTE, reducing a near-death sentence to a $1 billion fine and continued oversight. ZTE plead guilty to conspiring to violate USA sanctions against Iran and North Korea in a U.S. court previous year.

A group of senators has moved to attach an amendment to reimpose any penalty removed by the Trump administration on the firm to an annual defense policy bill that is expected to pass in the coming days.

In a meeting for senior management on Tuesday, ZTE chairman Yin Yimin said that the company needs its 80,000 employees to have "thorough knowledge" and "thorough supervision" of each other when it comes to compliance, rather than rely on a few people from a compliance team. The department also will select a monitor, known as a special compliance coordinator, within 30 days to report on compliance by ZTE and its affiliates worldwide for 10 years. The idea of ZTE being used as a bargaining chip in trade negotiations with China angered lawmakers, who view the company as a national security issue.

A separate monitor was appointed to a three-year term by a USA federal court in Texas last year.

In February, U.S. intelligence officials warned Americans not to use smartphones made by ZTE or Huawei - another Chinese telecom company - as the communication technology could be compromised "to gain positions of power inside our telecommunication networks that provides the capacity to exert pressure or control over our telecommunications infrastructure". ZTE is not allowed to take any action or make any public statement, even indirectly, denying any of the allegations.

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